FEDERAL COURT OF AUSTRALIA Maxims Entertainment Pty Ltd v Chinatown Enterprises Pty Ltd [2000] FCA 636 MAXIMS ENTERTAINMENT PTY LIMITED & ORS v CHINATOWN ENTERPRISES PTY LIMITED & ORS NG 918 of 1995 BURCHETT J 9 MAY 2000 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NG 918 of 1995 BETWEEN: MAXIMS ENTERTAINMENT PTY LTD First Applicant LONG SHONG PICTURES (HK) LTD Second Applicant PRO-VISION ENTERTAINMENT LTD Third Applicant POWER WORLD PRODUCTION LIMITED Fourth Applicant RISING SUN PICTURES LIMITED Fifth Applicant AND: CHINATOWN ENTERPRISES PTY LIMITED First Respondent WING CHEUNG Third Respondent JUDGE: BURCHETT J DATE: 9 MAY 2000 PLACE: SYDNEY EX TEMPORE REASONS FOR JUDGMENT 1 After this matter had followed a very tortuous course, through many directions hearings, and after a mediation which proved ultimately unsuccessful, it came to a final hearing at which the respondents did not appear. I heard evidence in proof of the applicants' case and gave a decision awarding the applicants, at that ex parte hearing, the sum of $15,680, together with seven-eighths of their costs. A bill of costs was in due course filed and, pursuant to the usual procedure in the Court, an estimate was produced in the Registry, which was that the amount at which seven-eighths of the costs would be likely to be certified following a taxation would be the sum of $79,252.25. There had, on the evidence, been a previous taxation, involving the same parties, in a related action in the Supreme Court of New South Wales, pursuant to which the respondents were liable to pay the sum of $27,682. There is, too, evidence that there was a further sum of $1300 owing in respect of the costs of a motion. 2 On the last day permitted for filing a notice requiring a taxation of the bill of costs in this Court, notice was given requiring such a taxation together with the requisite sum of $750 security. That was in November of last year. The taxation of the costs was fixed for a date in March of this year. Under Order 62, rule 41, sub-rules 3, 4 and 5, it was necessary for the respondents against whom the bill was to be taxed, the first and third respondents, to take certain action. What was required to be done by these respondents was to file a notice objecting to those items, or parts thereof, in the bill, which they wished to challenge at the taxation. By sub-rule 6, it is provided that: "Subject to the discretion of the taxing officer, to be exercised in exceptional circumstances, on taxation of the bill, no amount is to be taxed off, nor any ground of objection to an item or part of an item allowed, unless each amount, ground, item or part of an item, as the case may be, is specifically set out in a notice under subrule (3)." In fact no such notice of any kind was filed or served. The last day for filing and service of a notice was not less than 7 days before 3 March. 3 What then happened was that, on 3 March, a solicitor appeared for the first and third respondents and, according to the evidence now put before me on their behalf, sought an adjournment of the taxation. This evidence, I should add, is denied, and there has been no request to cross-examine in respect of that denial, or indeed in respect of the evidence put forward in the affidavit in support of the motion. Assuming the application for adjournment was actually made, it is clear, at any rate, that it was not acceded to; the taxation proceeded in accordance with the rule, and without any application being put to the Registrar in reliance on sub-rule 6, asserting any exceptional circumstances. 4 The taxation resulted, in this situation, in the sum which had been estimated being confirmed. What the third respondent, Wing Cheung, now seeks to do, by his motion, is to reopen the matter, so that a full taxation could take place in which a very large number of items could be challenged. Indeed, I was told from the bar table that the upholding of all the objections that it is sought to raise would reduce the sum to be allowed on taxation to $26,480. 5 The evidence is that nothing has been paid by the third respondent, or indeed by the first, Chinatown Enterprises Pty Limited, which has been dissolved, in respect of the sums owing, either under the judgment of the Court, or in respect of the costs in this Court, or in respect of the costs in the Supreme Court. 6 It seems to me that what the third respondent is seeking to do is have the Court exercise a discretion to waive the operation of the rules, and he is seeking to have this discretion exercised in his favour without proffering any fulfilment on his own part of any of his own obligations. There is no suggestion that any amount would be paid in relation to the sums which admittedly are due, including, of course, the sum of $26,480; nor is any security offered in relation to the costs, either that are owing or that would in the future be incurred if I were to make the order sought. As I have made clear, the first respondent is not available for the recovery of any of these amounts, since it has been dissolved, and the applicants in the principal proceeding would have to look to the third respondent. Notwithstanding that no payment or security is offered, the third respondent says that relief ought to be granted to him because he understood there was a prospect of settlement of the amount of the bill, and for that reason the notice of objections, although he says it was in fact prepared, was never filed. 7 There is strong dispute between the witnesses, in the affidavits, as to the details of the third respondent's assertions of justification for his assumption that settlement would take place; but the one thing that is clear is that, even on his own case, it was a matter of his hoping that a settlement would eventuate, rather than of his having any assurance that it would do so. In my opinion, having regard to the history of the matter, the third respondent's hopes would provide a very slender foundation for an exercise of discretion at this stage, but, to the extent that they might do so, they are overwhelmingly outweighed by his total failure to provide any measure of assurance, by way of security or otherwise, that an exercise of discretion in his favour might not simply increase the amount of the large sums already owing, in circumstances where no reason at all has been given to believe that a serious attempt would be made to pay. In that situation, I think the proper exercise of my discretion is to refuse the relief sought. Accordingly, the motion is dismissed with costs. 8 The counter-motion for security for costs and summary dismissal is consequently dismissed with no order as to costs. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice . Associate: Dated: 17 May 2000 Counsel for the Third Respondent, Applicant in the motion: Ms R N Winfield Solicitor for the Third Respondent, Applicant in the motion: William Chan & Co Counsel for the Applicant, the Respondent to the motion: Ms J Pentelow Date of Hearing: 9 May 2000 Date of Judgment: 9 May 2000